Mexico's Cemex posts surprise quarterly loss; shares drop
By Kylie Madry and Noe Torres
MEXICO CITY (Reuters) - Mexican cement producer Cemex posted an unexpected fourth-quarter loss on Monday, logging hefty one-off charges for impairment of goodwill and fixed assets.
It swung to a net loss of $99.1 million in the period from a profit of $194.8 million in the fourth quarter of 2021. Analysts had expected profit to climb after the company pushed through double-digit price hikes.
Cemex shares on Mexico's main stock exchange were down more than 3% in mid-morning trading.
The company's revenue increased, surging 8% to $3.87 billion, with robust sales growth in Mexico and the United States, although overall volumes dipped.
Cemex will continue to raise prices in 2023, Chief Financial Officer Maher Al-Haffar said in a call with analysts, as "the job is not done yet."
Blaming the global high inflationary environment and increasing interest rates, Cemex recognised a goodwill impairment charge of $365 million. Impairment losses for property, machinery and equipment came to $77 million.
Operating earnings before interest, tax, depreciation and amortization (EBITDA) for the quarter dropped 2% to $630.46 million.
Cemex's operating EBITDA margin was 16.3%, down from 18% in the year-earlier quarter.
"The contraction was the lowest of the year," Cemex Chief Executive Fernando Gonzalez said in a statement. "I am seeing growing evidence that actual margin recovery is underway."
Cemex also projected a low-single-digit increase in operating EBITDA in 2023, which analysts at Citi said "may imply further downside risk."
Cement sales are projected to slightly dip through the year, however, while energy costs per tonne of cement produced will rise about 10%.
The company also pegged its fixed-asset investment for the year at about $1.25 billion, which Citi analysts called "positive."
(Reporting by Kylie Madry and Noe Torres; Additional reporting by Aida Pelaez-Fernandez; Editing by Edwina Gibbs, Toby Chopra and Paul Simao)